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EUROPEAN CLOSING REPORT: THURSDAY – 21ST – JUNE – 2018 June 21, 2018 at 04:45PM

EUROPEAN CLOSING REPORT: THURSDAY – 21ST – JUNE – 2018

 

EUROPEAN CLOSING REPORT

THURSDAY – 21ST – JUNE – 2018

European cash equity markets are broadly lower at the closing bell having added to earlier declines this afternoon (FTSE -0.9%, DAX -1.4%, CAC -1.0%, FTSEMIB -1.8%). Italian stocks have underperformed somewhat
after the appointment of two Eurosceptic League lawmakers to high level positions. Auto stocks have also seen a notable declines following a profit warning from Daimler. We also saw a lower open on Wall Street where the DJIA looks set to set to extend its
losing streak to eight sessions. In the bond markets, US government bond yields have moved lower with the 10-year down 4 basis points to 2.90% while UK yields have given back their earlier BoE inspired rally. The Dollar has been underperformer in FX meanwhile,
for this afternoon anyway, while Sterling and the Norwegian Krone trade towards the top of the G10 pile after their respective central bank announcements. On the data front, US jobless claims were a touch lower than expected at 18K (f/c. 220K) while Philly
Fed and the leading index came up short. Euro Zone consumer confidence also dropped to -0.5% (f/c. -0.1) from 0.2. We heard from Minneapolis Fed President Kashkari who said they do not want to prematurely end the economic expansion while there are no signs
of overheating in the economy. Turning the oil markets, prices remain choppy as OPEC begin a series of meetings amid speculation they could boost production – US crude futures are currently up +0.3%. Saudi Energy Minister al-Falih said a 1 Mln BDP increase
is a good target. He added that Iran is unlikely to reject the idea of a 1 Mln BDP increase if there is an OPEC consensus. Still to come today, a US 30-year TIPS auction at 18:00 BST and comments from BoE Governor Carney at 21:15 BST.

Key Headlines/Data:

*  The US and China are said to be making effort to avert tariff implementation

*  US Commerce Secretary Ross said President Trump ultimately wants to lower trade barriers. He added that reciprocity is key to their trade policy.

*  Saudi Energy Minister al-Falih said a 1 Mln BDP increase is a good target. He added that Iran is unlikely to reject the idea of a 1 Mln BDP increase if there is an OPEC consensus:

*  Italian Economy Minister Tria reiterated that the Euro currency is not in doubt.

*  US Initial Jobless Claims 218K versus 220K expected, previous 218K revised to 221K

  • Continuing Claims 1.723 Mln versus 1.730 Mln expected, previous 1.697 Mln revised to 1.701 Mln

*  Philadelphia Fed Manufacturing Index (Jun) 19.9 versus 28.9 expected, previous 34.4

*  Canadian Wholesale Sales M/M (Apr) +0.1% versus +0.4% expected, previous +1.1% revised to +1.4%

*  US FHFA House Price Data (Apr):

  • House Price Index M/M +0.1% versus +0.1% expected, previous +0.1% revised to +0.2%
  • House Price Index Y/Y +6.4%, previous +6.7%

*  US Treasury Secretary Mnuchin said the US is committed to modernizing NAFTA

*  Minneapolis Fed President Kashkari said they do not want to prematurely end the economic expansion while there are no signs of overheating in the economy.

*  Euro Zone Consumer Confidence (Jun P) -0.5 versus -0.1 expected, previous 0.2

*  US Leading Index M/M +0.2% versus 0.4% expected, previous +0.4%

*  Iranian Oil Minister said Iran does not see a shortage in the oil markets and needs to be convinced that they need more production.

 

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